Synovus income surges in Q4

Fourth-quarter income surged at Synovus Financial Corp., parent of South Carolina-based NBSC bank, after the company used an accounting move to trim its income tax bill.

Based in Columbus, Ga., Synovus today reported net income of $712.8 million for the last quarter compared with $12.8 million for a similar period in 2011.

NBSC, which has 42 branch offices in South Carolina, ranked No. 6 among the state’s largest financial institutions with $2.74 billion in deposits for a 4.07% share of the S.C. market, the Federal Deposit Insurance Corp. reported in September. Synovus does not break out separately the financial performance of its South Carolina operations at NBSC.

For the year, Synovus reported net income of $775 million compared with $118.7 million for 2011.

The fourth-quarter results include an income tax benefit of approximately $800 million from the recapture of substantially all the losses it suffered as the result of the housing downturn and bad investments, Synovus said.

The fourth-quarter results also reflect the completion of distressed asset sales of approximately $545 million, including the execution of a bulk sale effective Dec. 10. The fourth-quarter distressed asset dispositions resulted in a pretax charge of approximately $157 million.

"Our fourth-quarter performance represents another huge step forward for our company," said Kessel D. Stelling, chairman and CEO of Synovus. "The recapture of the deferred tax asset is a significant milestone that reflects years of progress and further demonstrates our company's return to a position of strength. Additionally, the successful execution of the bulk sale during the fourth quarter accelerates credit quality improvement and also enhances our future financial performance."

Pretax, pre-credit costs income was $108.0 million for the fourth quarter of 2012, down $3.5 million from $111.5 million for the third quarter of 2012.

Net interest income was $207.5 million for the fourth quarter of 2012, down $4.9 million from $212.3 million in the previous quarter. Meanwhile, total noninterest income was $80.1 million for the fourth quarter of 2012, up $6.9 million, compared with $73.2 million in the third quarter of 2012.

Synovus also has boosted its bottom line through a number of cost-cutting moves, Stelling said.

"We have made substantial progress in aligning our operating costs with the current size of our organization," Stelling said. "Core expenses decreased by $25.1 million and $95.3 million in 2012 and 2011, respectively, reflecting the impact of the efficiency initiatives implemented during those two years. We have identified new expense savings initiatives of approximately $30 million, with the implementation of these initiatives already under way and continuing throughout 2013.”